DTN Midday Livestock Comments 02/16 12:52
Mixed Cattle Trade Keeps Active Sluggish
Limited interest is seen in all livestock futures Friday. The cattle market
is holding a mixed market shift following recent price support. Hog futures
remain lower, although the tone of the market is weak given the light trade.
By Rick Kment
Mixed trade is seen at midday in cattle trade with prices hovering a narrow
to moderate trading range while very little direction is seen through the
entire complex. The additional pressure in hog futures is not a surprise,
although it is bringing additional weakness to the entire market. Corn prices
are mixed in light trade. March corn futures are steady Friday. Stock markets
are higher in light trade. The Dow Jones is 201 points higher while Nasdaq is
up 42 points.
Futures trade remains stuck in a narrowly mixed trading range at midday with
very little market direction developing across the complex. Prices are seen 15
cents lower to 17 cents higher in nearby contracts while the early pressure in
the market has pushed slightly more aggressive weakness in deferred contracts.
This could add even more softness into price levels ahead of the long weekend.
Trade is likely to remain very sluggish over the next couple of hours. Cash
cattle trade is still undeveloped although bids have become more active as the
morning has progressed. Cash bids are still at $124 per cwt while dressed bids
have improved to $202 per cwt through the morning. But there still remains a
moderate gap between bids and asking prices with asking prices at $130 to $132
live and $205 dressed. Boxed beef cut-outs at midday are higher, $0.02 higher
(select) and up $0.16 per cwt (choice) with light movement of 54 total loads
reported (32 loads of choice cuts, 8 loads of select cuts, zero loads of
trimmings, 13 loads of ground beef).
Mixed trade is seen Friday morning as traders are slowly moving back from
the narrow to moderate losses that enveloped the cattle complex Friday. Overall
trade volume remains extremely sluggish with traders looking for increased
market direction long term and the potential that additional buying will step
back into the market next week following the long weekend. With markets closed
on Monday while the majority of the industry does not view Presidents Day as a
major holiday, it is likely that some market adjustments will be done either on
the front or back end of this market closure. This could keep trade more
volatile through the end of the day.
Moderate to strong pressure is developing across nearby lean hog futures as
traders focus on April contracts moving to the official front month contract.
This move has pushed April futures $1.25 per cwt lower to $68.47 per cwt. The
overall lack of support in the rest of the market ahead of the weekend is
expected to leave most traders willing to stay in the background. Cash prices
are lower on the National Direct morning cash hog report. The weighted average
price is down $1.10 at $64.67 per cwt with the range from $59.00 to $65.50 on
4,097 head reported sold. Cash prices are lower on the Iowa/Minnesota Direct
morning cash hog report. The weighted average price is down $1.84 at $63.66 per
cwt with the range from $59.00 to $64.50.00 on 447 head reported sold. The
National Pork Plant Report posted 163 loads selling with carcass values falling
$0.73 per cwt. Lean hog index for 2/14 is at $73.49, down 0.52 with a projected
two-day index of $72.89, down 0.60.
Rick Kment can be reached at firstname.lastname@example.org
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